EXCLUSIVE MANUFACTURING AGREEMENT
Exhibit 10.3
THIS EXCLUSIVE MANUFACTURING AGREEMENT
is made as of the 1st day of August, 2008 by and between XXXXX XXXXX AND
ASSOCIATES, INC., a Colorado Corporation, its successors, affiliates, and
assigns, Xxxxxx Xxxxxxxx an individual residing in the State of Arizona, his
successors, and assigns (hereinafter all collectively referred to as the
"Licensee") and, FUEL CONCEPTS LLC, an Ohio Limited Liability Company, its
successors, affiliates, and assigns (hereinafter all collectively referred to as
the “Manufacturer”). Sometimes referred to herein collectively as “the
parties”.
NOW, THEREFORE, in
consideration of the promises hereinafter made by the parties hereto, it is
agreed as follows:
ARTICLE
I
APPOINTMENT
OF MANUFACTURER
1. Manufacturing
Right. Licensee
hereby appoints and grants Manufacturer the exclusive world-wide non-assignable
right to manufacture products for Licensee defined in the “Current Price List" as set
forth in “Exhibit "A" attached
hereto.
2. Prices. All prices stated are listed in the
“Current Price
List" as set forth in “Exhibit A" attached
hereto. Said prices are listed at Manufacturer’s actual cost to produce each
individual unit of products listed in the “Current Price List" as set
forth in “Exhibit A" attached hereto and do not
include transportation or shipping costs of any kind or federal, state or local
taxes of any kind or nature.
3. Terms. All Purchase Orders
submitted to Manufacturer shall be paid in full with in Seven (7)
business days of submission of the Purchase Order.
4. Title to
Products. Title
to the Products shall at all times remain with Licensee. Manufacturer shall at
no time, have any right, title and interest of any kind in products manufactured
under this Agreement.
5. Quality
Control.
(a) Manufacturer
shall cause all products submitted to Manufacturer by Licensee for production
under this Agreement, to be manufactured in strict accordance with Licensee’s
exact product specifications and shall institute and comply with all quality
control procedures necessary to meet such requirements. All product manufactured
under this Agreement that do not meet or exceed Licensee's product
specifications shall either be replaced or repaired in accordance with Article
VI of this Agreement.
(b) In
the event that Manufacturer shall fail to manufacture Licensee’s products in
accordance with Licensee’s exact product specifications and Quality Control
requirement of
any specific PO, the circumstances of which would cause the specific PO
to have a failure of .003% or greater of the total number of units
ordered per that specific PO more three (3) times during the term of this
Agreement, this Agreement shall automatically and without further notice,
convert to a NON-EXCLUSIVE
(c) Manufacturing
Agreement and Licensee shall have full rights to manufacture its products with
any other manufacturer that Licensee may deem appropriate. Failure is defined as
the products inability to adjust and maintain the desired flow of gasoline as
specified by the Manufacturer.
ARTICLE
III
DELIVERY
1. Purchase
Orders and Delivery Requirements.
(a) Licensee
shall order all products to be manufactured by written notice (The “Purchase
Order” hereinafter collectively referred to as the “PO”) to Manufacturer. Each
PO submitted to Manufacturer shall specify the number of units to be
manufactured, the type of units to be manufactured, which shall be identified by
the model number designations as indicated in the Price List as set forth in “Exhibit A" attached
hereto and include the desired method of shipment and delivery date
requirements. Manufacture shall indicate its acceptance of each PO submitted
under this Agreement by returning a signed, accepted copy to Licensee within 24
hours of submission by Licensee.
(b) In
the event that Manufacturer is unable to meet the specific delivery requirements
set forth in any PO submitted, Manufacturer shall notify Licensee in writing no
later then three (3) days from the receipt of the PO and request a delivery
modification. All delivery modifications must be approved, in writing by Licensee prior to the
commencement and fulfillment of the specific PO.
(c) In
the event that Manufacturer is unable to meet the delivery requirement of any specific PO,
the circumstances of which would cause the delivery and fulfillment of the
specific PO to be delayed by thirty (30) days or more, Licensee shall have the
write to seek an outside manufacturer to manufacture the specific
PO.
(d) In
the event that Manufacturer is unable to meet the delivery requirement of any specific PO, the
circumstances of which would cause the delivery and fulfillment of the specific
PO to be delayed by thirty (30) days three (3) times during the term of this
Agreement, this Agreement shall automatically and without further notice,
convert to a NON-EXCLUSIVE Manufacturing Agreement and Licensee shall have full
rights to manufacture its products with any other manufacturer that Licensee may
deem appropriate.
2. Shipping
and Transportation of Manufactured Products.
(a) Manufacturer
shall ship units to Licensee in accordance with the delivery requirement set
forth in each PO as accepted by Manufacturer.
(b) All
shipments of Product shall be made Fright On Board (herein after referred to
“FOB”) Manufacturer's facilities and liability for loss or damage in
transit, shall stay with Manufacturer until such time as delivery of Product, as
defined in each individual PO, reaches its final port of
delivery.
(c) Licensee
shall bear all costs of transportation, insurance, import duties, tariffs,
taxes and
docking fees and will promptly reimburse Manufacturer if Manufacturer
prepays or otherwise pays for such expenses.
(d) Manufacturer
shall not be in default by reason of any failure in its performance under this
Agreement if such failure results from, whether directly or indirectly, fire,
explosion, strike, freight embargo, Act of God or of the public enemy, war,
civil disturbance, act of any government, dejure or de facto, or agency or
official thereof, material or labor shortage, transportation contingencies,
unusually severe weather, default of any other manufacturer or a supplier or
subcontractor, quarantine, restriction, epidemic, or catastrophe.
(e) Licensee shall be
responsible for all costs from the port of delivery to their containment
facility for
purchase orders.
3. Cancellation. Licensee shall have the
right to cancel any specific PO upon three (3) business days written notice to
Manufacturer from the date of issuance of the original PO.
ARTICLE
VI
WARRANTY
1. Product
Warranty.
(a) Manufacturer
warrants that Licensee shall acquire all Product purchased hereunder free and
clear of any and all liens and encumbrances of any kind or nature, expressed or
implied, whether in law or by contract.
(b) Manufacturer
warrants all Product manufactured under this Agreement shall be free from
defects in materials, workmanship, manufacturing or fabrication under normal use
and service for a period of ninety (90) days from the date of delivery as
provided under Section 2(a) of Article III of this Agreement.
(c) All
repair covered by this warranty shall be done at Manufacturer's facilities, or
other such warranty repair facilities designated by Manufacturer.
(d) Any
defect corrected within ninety (90) days and found to be within this scope of
the warranty shall be repaired or replaced by Manufacturer in a timely manor and
without delay of any kind.
(e) Shipping costs
for repaired or replaced products shall be born by the
Manufacturer back to Licensee. Shipping costs for repaired or
replaced products to the Manufacturer shall be born
by the Licensee.
ARTICLE
VI
SPARES,
STANDARD SUBASSEMBLIES AND PARTS
1. Availability.
(a) Spares,
standard subassemblies and parts as used herein, shall be defined as components
defined and required by the Licensee’s product specifications used to fabricate
and/or repair the Product manufactured by the Manufacturer .
(b) Manufacturer
shall make spares for purchase by Licensee for a period of not less than one (1)
year after shipment of the last unit to Licensee hereunder. Such spares will be
available to Licensee at prices, terms and conditions in effect at the time such
spares are purchased.
ARTICLE
VII
DURATION
OF AGREEMENT
1. Term.
The term of this Agreement shall be for 5 years from the date
hereof, unless sooner terminated. Termination shall not relieve either party of
obligations incurred prior such termination.
2. Termination.
This Agreement may be terminated only:
(a) By
either party for substantial breach of any material provision of this Agreement
by the other, provided due notice has been given to the other of the alleged
breach and such other party has not cured the breach within thirty (30) days
thereof; or
(b) By
Manufacturer:
(i)
If
Licensee ceases to function as a going concern or makes an assignment for the
benefit of creditors; if a petition in bankruptcy is filed by or against the
Licensee, resulting in an adjudication
of
bankruptcy;
(c) By
Licensee:
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(i)
|
If
Manufacturer ceases to function as a going concern or makes an assignment
for the benefit of creditors; if a petition in bankruptcy is filed by or
against the Manufacturer, resulting in an adjudication of
bankruptcy;
|
|
(ii)
|
If
Manufacturer fails to meet all quality control standards established
Licensee and set forth in Article 1, Section 5(a),(b) of this
Agreement.
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(c) Upon
termination of this Agreement all further rights and obligations of the parties
shall cease, except that Licensee shall not be relieved of (i) its obligation to
pay any moines due, or to become due, as of or after the date of termination,
and (ii) any other obligation set forth in this Agreement which is to take
effect after the date of termination.
ARTICLE
VIII
NOTICES
1. Notice or
Communication. Any notice or communication required or
permitted hereunder shall be in writing and shall be sent by registered mail,
return receipt requested, postage prepaid and addressed to the addresses set
forth below or to such changed address as any party entitled to notice shall
have communicated in writing to the other party. Notices and communications to
the Parties shall be sent to:
(i) if to
Owner,
to: Fuel
Concepts, LLC
00000
Xxxxx Xxxx
Xxxxx
Xxxxxxxx, Xxxx 00000
Facsimile:(000)
000-0000
(ii) if
to Licensee,
to: 00000
X. 00xx Xxxxxx, Xxxxx 000
Xxxxxxxx,Xxxxxxx 00000
Phone: (000)-000-0000
Facsimile:
(000)-000-0000
ARTICLE
IX
GENERAL
PROVISIONS
1. Relationship
of Parties. The relationship between the parties established by this
Agreement shall be solely that of vendor and vendee. The Licensee
shall have no right, power or authority in any way to bind the Manufacturer to
the fulfillment of any condition not herein contained, or to any contract or
obligation, expressed or implied.
2. Independence
of Parties. Nothing contained in this Agreement shall be construed to
make the Licensee the agent for the Manufacturer for any purpose, and neither
party hereto shall have any right whatsoever to incur any liabilities or
obligations on behalf or binding upon the other party. The Licensee specifically
agrees that it shall have no power or authority to represent the Manufacturer in
any manner; that it will solicit orders for products as an independent
contractor in accordance with the terms of this Agreement; and that it will not
at any time represent the Manufacturer in any manner; that it will solicit
orders for products as an independent contractor in accordance with the terms of
this Agreement.
3. Indemnity.
(a) The
Licensee agrees to hold the Manufacturer free and harmless from any and all
claims, damages, and expenses of every kind or nature whatsoever (a) arising
from acts of the Licensee; (b) as a direct or indirect consequence of
termination of this Agreement in accordance with its terms; or (c) arising from
acts of third parties in relation to products sold by Licensee, its
distributors, su-distributors, contractors, agents, affiliate or employees
thereof under this Agreement, including, but not limited to installation,
service, or execution of liens and security interests by third parties with
respect to any such products.
(b) The
Manufacturer agrees to hold the Licensee free and harmless from any and all
claims, damages, and expenses of every kind or nature whatsoever (a) arising
from acts of the Manufacturer; (b) as a direct or indirect consequence of
termination of this Agreement in accordance with its terms; or (c) arising from
acts of third parties in relation to products manufactured for Licensee by
Manufacturer, its contractors, agents, affiliate or employees thereof under this
Agreement.
4.
Assignment.
(a) By
Licensee. The Licensee may assign its rights, in whole or in part,
under this Agreement to any person or entity including, without limitation any
subsidiary, affiliated or controlling corporation, any person owning or
acquiring a substantial portion of the stock or assets of the Licensee, or
any partnership or other venture in which the Licensee substantially
participates, and any such rights may be similarly assigned by any assignee of
the Licensee. The Licensee may also assign any of its rights to any of its
sub-licensees, distributors or sub-distributors.
(b) By
Manufacturer. Manufacturer may only assign this Agreement to a
corporation, limited liability company or other entity that is wholly owned and
controlled by Manufacturer, provided such assignee accepts in writing
responsibility to perform all of Manufacturer’s executory obligations pursuant
to this Agreement, and provided further that no such assignment(s) shall excuse,
discharge or otherwise relieve manufacture from any of Manufacturer’s
obligations under this Agreement. Manufacturer also may assign the proceeds
derived from this Agreement, as and when payable in accordance with the terms
and conditions set forth in this Section 4 (b) of Article IX.
5. Entire
Agreement. The entire Agreement between the Manufacturer and the Licensee
covering the Product is set forth herein and any amendment or modification shall
be in writing and shall be executed by duly authorized representatives in the
same manner as this Agreement. The provisions of this Agreement are severable,
and if any one or more such provisions are determined to be illegal or otherwise
unenforceable, in whole or in part, under the laws of any jurisdiction, the
remaining provisions or portions hereof shall, nevertheless, be binding on and
enforceable by and between the parties hereto.
6. Choice of
Law; Venue; Jurisdiction; Attorneys’
Fees. The
parties acknowledge and agree that this Agreement has been made in Arizona, and
that it shall be governed by, construed, and enforced in accordance
with the laws of the State of Arizona, without reference to its conflicts of
laws principles. The parties also acknowledge and agree that any
action or proceeding arising out of or relating to this Agreement or the
enforcement thereof shall be brought in the Maricopa County Superior Court, and
each of the parties irrevocably submits to the exclusive jurisdiction of that
Court in any such action or proceeding, waives any objection the party may now
or hereafter have to venue or to convenience of forum, agrees that all claims in
respect of such action or proceeding shall be heard and determined only in that
Court, and agrees not to bring any action or proceeding arising out of or
relating to this Agreement or the enforcement hereof in any other
court. The parties also acknowledge and agree that either or both of
them may file a copy of this paragraph with any court as written evidence of the
knowing, voluntary and bargained agreement between the parties irrevocably to
waive any objections to venue or convenience of forum, or to personal or subject
matter jurisdiction. The parties also acknowledge and agree that any
action or proceeding referred to above may be served on any party anywhere in
the world without any objection thereto. The parties also acknowledge
and agree that the prevailing party in any such action or proceeding shall be
awarded the party’s reasonable attorneys’ fees and costs (including, but not
limited to, costs of court).
7. Jurisdiction. Service of
Process. Any action or proceeding arising out of or relating to this
Agreement shall be governed by Section 6 of Article IX of this Agreement, and
each of the parties irrevocably submits to the exclusive jurisdiction of each
court identified therein in any such action or proceeding; waives any objection
the party may now or hereafter have to venue or to convenience of forum; agrees
that all claims in respect of the action or proceeding shall be heard and
determined only in any such court; and agrees not to bring any action or
proceeding arising out of or relating to this Agreement or any transaction
contemplated hereby in any other court. The parties agree that either
or both of them may file a copy of this paragraph with any court as written
evidence of the knowing, voluntary and bargained agreement between the parties
irrevocably to waive any objections to venue or to convenience of
forum. Process in any action or proceeding referred to in the first
sentence of this Section 7 of Article IX may be served on any party anywhere in
the world
8. Separate
Provisions.
If any provision of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall in no way be affected or impaired thereby.
9. Covenant
Not To Compete: The Manufacturer agrees not to compete with the Licensee
or to manufacture, fabricate, represent, sell directly or indirectly cause or
facilitate the sale of products not belonging to Licensee which are deemed to be
competitive with the Licensee's Products. Furthermore Manufacturer
agrees not to manufacture or cause to be manufactured either directly or
indirectly or through other parties any parts or products manufactured by
Licensee or any variation of the products offered by Licensee or
future products and parts produced by the Licensee. As provide for in Section 6
of this Article IX, in the event that litigation results from or arises out of
this Agreement or the performance thereof, the Manufacturer agrees to reimburse
the Licensee reasonable attorney's fees, court costs, and all other expenses,
whether or not taxable by the court as costs, in addition to any other relief to
which the Licensee may be entitled to.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the
parties have caused this Agreement to be executed by their duly authorized
officers as of the date and year indicated above.
"MANUFACTURE"
FULE
CONCEPTS, LLC a Ohio Limited Liability Company
EIN#
00-0000000
XXX
XXXXXX
By: Xxx
Xxxxxx
Its:
Managing Member
"LICENSEE"
XXXXX
YOUNG AND ASSOCIATES, INC., a Colorado Corporation
EIN#
00-0000000
XXXX
XXXXXXXX
By: Xxxx
Xxxxxxxx
Its:
President
"LICENSEE"
Xxxxxx
Xxxxxxxx, an Individual
By: XXXXXX
XXXXXXXX
Xxxxxx
Xxxxxxxx
EXHIBIT
A
PRICE
LIST AS OF January 1, 2008
2. Dealer
Pricing
Schedule Dealer
Price List
|
Units
Ordered
|
Dealer
Price (Shipping costs are not include in price)
|
|
3,000 and
up
|
$18.00
USD
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E3
Fuel Saver 7000 parts and specifications
The E3
Fuel Saver 7000 kit shall contain the following items which shall for present be
manufactured in China.
1) 1 (EACH) 8”x8”x2 ¾” box for
housing all parts included.
A) Artwork on box will be pre-printed per AEDC’s artwork
specifications.
2) 1 (EACH) E3 Fuel Saver Fuel
Saver Manifold herein called the “Head”. The head
shall be
constructed from HEX 6061 T6511 aluminum and shall contain the xxxx
“E3 Fuel Saver 7000” and the patent number 7117859 on the front side of the
head.
The Head
shall contain the following parts attached and assembled:
A) 2 (each) 3/8”x ¼ NPT (national pipe thread)
brass barbed fittings
B) 1 (each) 1/8” NPT Male x 1/8” brass Female tube
compression fitting
C) 1 (each) 10/32” brass threaded needle with
a 30 degree male needle to match needle seat pre-manufactured inside the
head.
1) The
Needle shall have one
small tension spring and one o-ring fitted on
needle prior to assembly.
D) The
Head shall contain a one 3/16” mounting slot (hole)
at the top to allow insertion of mounting screw for secure
mounting.
E)
1 (Each) threaded and
sealed 80 ml. molded aluminum canister.
F)
1 (Each)
7/8” x .060
nylon seal will complete the seal between the 80 ml aluminum canister and
the pre-manufactured thread slot located at the bottom of the Head.
E)
1 (Each) aluminum
tamper resistant cap.
Note: thread sizes may be
converted to metric on some parts. These conversions are NOT CRITICAL and will
not affect the basic performance or function of the E3 Fuel Saver
7000.
3) 10 feet -approx. (3 meters)
3/8 inch fuel line hose meeting SAE 30R7 spec.
4) 4 feet 1/8” refrigeration
copper tubing pre-rolled for ease of packaging.
Copper
tubing shall be preassembled with the following items attached:
1) 2 Each 1/8” brass ferrules
2) 2 Each 1/8” Male compression nuts
3) 2 Each 1/8” Plastic End Caps
5) 1 SET Complete Installation
Instructions- English/French/Spanish.
6) Fuel Adaptor Kit with the
following items:
1) 1 Ford Xxxxxxxx Adapter
2) 1 Universal Xxxxxxxx Adapter
3) 1 Xxxxxxxx Valve Stem removal tool
4) 1 Brass fuel line “TEE” (brass)
7) Miscellaneous parts kit
containing the following items:
1) 6 steel hose clamps
2) 10 plastic zip ties
3) 1 mounting screw
4) 1 Rubber washer for mounting screw.
